Sacramento, California– California’s largest insurance regulator said the state is seeking millions of dollars in fines from State Farm after an investigation found the insurer violated state law while handling claims stemming from the 2025 Los Angeles-area wildfires.
Insurance Commissioner Ricardo Lara said Monday that State Farm had violated the law hundreds of times.
Lara I launched an investigation Last June after the survivors of the barriers and Eaton fires He said the state’s largest home insurance company was delaying and mishandling claims related to damage to their homes and potential pollution from smoke.
“Our investigation found that State Farm delayed policyholders, underpaid them, and buried them in red tape at the worst moments of their lives,” Lara said in a statement. “This is unacceptable, and we are taking decisive action to hold them accountable.”
The two fires were devastating, killing 31 people and destroying more than 16,000 structures.
The department looked at 220 random claims submitted to State Farm and found nearly 400 violations. These factors included low payment and slow or inadequate claims processing. State Farm has received more than 11,000 claims due to the Los Angeles wildfires, representing about a third of all claims filed, state officials said. The administration said thousands of people could be affected by illegal behaviour.
The final amount of penalties will be recommended by the Administrative Judge and finalized by Lara.
State Farm is the second insurer to face legal action from the state over its handling of Los Angeles fire claims. The department is also seeking REMEDIES AGAINST FAIR PLAN To deny smoke damage claims. The plan is an insurance pool into which all the major private insurance companies pay, and the plan then issues policies to people who cannot get private insurance because their property is considered too risky to insure.
State Farm did not immediately respond to a request for comment.